Long term care is not medical care, and is not covered by
Medicare, or individual health insurance.
Long term care is for people who need
help with the activities of daily living. According to the
Department of Health and Human Services, the "activities of daily
living," or ADLs, are the basic tasks of everyday life, such as:
- Eating
- Bathing
- Dressing
- Toileting
- Transferring.
Most long term care happens at home, however long term care
can take place in Adult Day Care, Adult Foster Care Homes, Assisted Living
Facilities, and Nursing Homes. Medical Insurance does not cover Long Term Care.
The vast majority of Americans do not have long term care insurance, even
though according to the American Association for Long Term Care Insurance, “For
someone with a 90-day Elimination (waiting) Period, the lifetime chance of
someone buying coverage at age 60 and using policy benefits was 35%.
So, 35% will use their coverage and 65% will not. ” The majority of people will
use their life savings to pay for long term care, pass along the burden to
their family or to the state through Medicaid.
When I ask clients how they plan to deal with the costs of
long term care, the two top tongue in cheek responses are I have a .45 next to
my bed or my daughter is a nurse. Both answers are very unrealistic. What if the
daughter who is a nurse needs to work and save for retirement?
In general people who do not have any savings to protect don’t
have many choices, their care is going to fall to family and to Medicaid.
However there are choices to help people protect their family and their savings
from the cost of long term care. Options include traditional Long Term Care
Insurance, Short Term or Recovery Care Insurance, Hybrid Long Term Care Life
Insurance and Annuity contracts.
Excellent points!
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